Over the years, Alberta NDP leader Rachel Notley has made it clear that she is not comfortable with the development of Alberta’s conventional oil and gas industry using hydraulic fracturing technology and the required volumes of water.
In the summer of 2012, as the NDP environment critic, she said there are too many questions about the safety and impact (of fracking) on Alberta’s water supply. “If we don’t get a better understanding of what’s safe for Albertans, we run the risk of doing some really long-term damage,” Ms. Notley said. “In Alberta, we have no regulation — at all — that specifically covers fracking activity.”
Back then and still today, she suggested “there are a lot of questions that have be answered before we start holus-bolus giving out water to the fracking industry without knowing the safety that needs to come along with that.” Ultimately, Ms. Notley would like for an “independent investigation on [fracturing] technology.”
Today, nearly 100% of conventional oil and gas development in Alberta is executed using hydraulic fracturing. And so it is impossible to deny the importance of it to Alberta industry. Furthermore, the majority of capital investment pouring into Alberta today is not so much for the development of the oilsands, but for the development of conventional oil and gas plays; specifically the Deep Basin.
The question then becomes, how far would a Notley led Provincial Government go in putting on the reins for continued use of fracturing technology? How much is Ms. Notley willing to impact the continued economic prosperity of Alberta? Given the Alberta NDP’s political rhetoric, perhaps something as extreme as a moratorium on fracturing wouldn’t be too far out of the question.
Bill Andrew, Chairman and CEO of Calgary based Long Run Exploration, made it clear that “without fracturing in Alberta, there is no conventional oil and gas development.” In helping to grasp the scope of conventional oil and gas in Alberta, Mr. Andrew likes to remind people that “everything West of Edmonton, South to the United States border and North to the NWT is a conventional play and so has been developed recently using hydraulic fracturing.”
Fracturing also is nothing new. Since the 1950’s, tens of thousands of wells have been drilled using fracturing technology; all with minimal issue. Mr. Andrew noted, “Alberta has lead the way in working with the environment and have been miles and miles ahead of the United States.” Indeed, Alberta was the first jurisdiction to implement a ‘solution gas capture’ regulation and require the listing of chemicals used in the fracturing process.
The conventional oil and gas industry is the backbone of the rural Alberta economy. West of Edmonton, all of the rural communities rely on its continued development. Remarkably, 90% of the conventional industry in Alberta is Canadian owned, operated and financed. With 35 years of industry experience, Mr. Andrew wonders whether Albertans, “really believe that the leaders of the industry, who are majority Canadian, would want to leave a legacy of a tarnished environmental record.” He adds, “as Albertans, it is not in our own best interest.”
By looking to potentially harness fracturing in Alberta, one has to wonder whether Rachel Notley really understands the impact that such a change would have on Alberta’s communities and overall economic health. Granted, having the capacity to conduct a ‘review’, as the NDP yearn for, is fundamentally important to a well-functioning democracy. However, given the rhetoric of the Party, you have to wonder if their mind is already made up on fracturing technology.
In business, politics, or any situation requiring sound decision making, Mr. Andrew concludes “there is cause for concern when anyone has their mind already made up.” And while he doesn’t necessarily think that NDP have come to an early conclusion regarding fracturing’s viability towards the environment, the hope is that this wouldn’t be the case.
After all, as it is abundantly clear, the stakes are quite high.